A law expert has proposed the enactment of a law giving timelines for payment of pending bills in Counties and the National government in order to cushion contractors and suppliers from losses.
Melisa Achieng an advocate of the High Court of Kenya says penalties for delayed payments should be imposed by the Controller of Budget in order to ensure compliance.
“A Public Payment Timeliness Act to ensure payments are made within specific timelines, empowering the Controller of Budget to impose penalties for delayed payments, and establishing a Pending Bills Fund or Guarantee Scheme to cushion contractors. Additionally, the County Governments Act could be strengthened to link disbursements to verified bill clearance,” said Achieng
She said most Counties are struggling to pay pending bills due to poor revenue collection, weak financial discipline, budget deficits, and misallocation of funds.
“In many instances, counties prioritize new projects or salaries over clearing existing obligations. Political interference and procurement irregularities have also worsened the backlog,” said Achieng.
She said pending bills cripple cash flow for small and medium enterprises that depend on timely payments with Contractors forced to lay off workers, default on loans, or shut down operations.
“Nationally, this slows economic growth, increases non-performing loans, and erodes trust in public procurement systems,” said the law expert during an interview with Sacco Review yesterday.
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She added that Counties should audit and verify all pending bills, create a payment prioritization schedule, and implement strict financial controls to prevent future accumulation.
“Counties must also ring-fence development funds, digitalize procurement, and enforce prompt payment policies as required under the Public Finance Management (PFM) Act,” she said.
Achieng pointed out that the Controller of Budget can demand quarterly compliance reports, refuse to approve withdrawals for non-priority expenditures where pending bills exist, and recommend sanctions for accounting officers who breach the PFM Act in addition to publishing county payment schedules to promote accountability.
She said failure to pay pending bills may lead to litigation which end up consuming more public funds, attachment of county accounts, and audit queries by the Auditor-General.
“A contractor can write a formal demand letter to the County Secretary or Chief Officer Finance, file a claim before the Public Procurement Administrative Review Board, institute civil proceedings in court, petition the Senate or Controller of Budget, or report to the EACC if corruption or diversion of funds is suspected,” she advised.
Achieng said under the Public Finance Management Act and Leadership and Integrity Act, a governor bears ultimate political and administrative accountability.
She said persistent non-payment or misuse of funds may attract personal liability, impeachment, or criminal investigation for dereliction of duty.
By Gastone Valusi
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